“Investments in water-use monitoring software can provide water suppliers and end-use customers with valuable insights on where the greatest opportunities for savings are, as well as the most effective tools to realize those savings,” Robin Gilthorpe, CEO of WaterSmart, said at the time of Brown’s announcement.

As part of the effort to slash water use in coming months, California will replace 50 million square feet of lawns and create statewide consumer rebate programs to replace old appliances with more water- and energy-efficient models. Water agencies will also have to implement conservation pricing to encourage people to cut back on water use.

The San Francisco-based startup is like Opower for water, offering behavioral conservation and analytics for water utilities that can increase customer engagement and target those best suited for efficiency programs. In some California locations, such as Palo Alto, Opower and WaterSmart have teamed up.

WaterSmart is already working with about 40 utilities in the U.S., with a concentration in water-scarce California, as well as Colorado, Utah and Texas. The company claims over 1 billion gallons of water saved across about 2 million homes.

On average, WaterSmart can help save about 5 percent per household. Additionally, it can help cash-strapped water utilities understand where to focus their residential conservation efforts to get the most bang for their buck. WaterSmart has found households who receive the reports are about twice as likely to participate in rebate and audit programs.

“Demand is growing for data-driven solutions in the water sector, which has underpinned remarkable growth for our business,” said Gilthorpe. Software like WaterSmart's can not only help meet the 25 percent reduction in the coming year, but it will also help with meeting compliance standards, which include permanent monthly reporting of water usage, conservation and enforcement actions.

WaterSmart has also refined its product in recent years, fine-tuning how often reports should be delivered (sometimes quarterly is enough) and which metrics to show people (e.g., water used per billing period vs. water use per day). The startup is well positioned to ink deals with California water utilities in the near future in light of the new regulations. About one-quarter of its clients came on board in the latter half of 2014, and most of them are in California.

WaterSmart has previously raised $6.4 million. The latest funding came from all participating investors, including The Westly Group, Apsara Capital, Physic Ventures and Draper Fisher Jurvetson.